OfflineWe are looking for someone who does down payment assistance, for example - if we are getting a loan for $100,000, and putting $30,000 down but our purchase price is actually $50,000, then we would have $50,000 at closing to pay back the down payment assistance plus the percentage for using it. We have many lenders who will do the loan for up to 70% ARV or LTV ( some as high as 83% ). Most of the proerty purchase prices we are working on are 65% or less, and since the loans are up to 70% of the value we were looking for someone to loan us the down payment, then at close you get your down back plus interest. If anyone on here knows anyone doing that please reply. Thank you for your time.
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something, but what you are planning to do is bank fraud. You can't tell a bank you are buying ar 100 when you are buying at 50.
Always Looking to Acquire Houses | Always Looking to Amaze Investors
I don't say I am buying at 100 when it's 50. The lender ( private or HML )loans 70% of the value. So (one I am working on right now) the property is valued at 1,613,900.So my lender will do the loan for 1,129,737(My loan I am actually asking for is 910,000). On the executive loan summery, it asks for the purchase amount, 850,000 and 3% -25,500 = 875,500 and it ask for desired loan amount - what you want - I can ask for anything up to the 1,129,737 but I only want 910,000 ( this allows for a lower appraisal even though the tax value is that ). This covers any down payment assistance I get. So I have about 34,500 left at closing ( plus any prorated rents ) to cover my down payment help interest.
I have someone in my REI Club that does that...you can PM me for the information.
that's for someone who is selling to an end buyer and just making money on the flip - I'm not flipping just buying. You have to have a purchase agreement with an end buyer to get approved for trans funding. I could do it like a bridge loan for 1-3 yr period, but not sure.
Like Bill stated above, I would still check with the lender if this is even allowed. Typically lenders don't like the downpayment being borrowed; they want to see you put in your own funds (skin in the game).
Curious what the monthly payments will be on a $910,000 loan? Does the rental income from the property cover it?
- Tom
I am always upfront about what I want to do, and you can JV with someone for a down, it looks better if you JV together in an LLC though because it keeps the LTV lower, but most lenders don't mind as long as they stay in the 1st position. Now it's harder to find a lender to loan the down because it would require a 2nd position and in today's market most lenders want 1st position. If that helps.
To keep out of trouble when JVing for the down, always make sure the JV is paid back their down at closing, otherwise there are a whole lot of other securities risks, issues, and guidelines.
The property rents for more than enough to cover it. DSCR only needs to be 1.2 or higher to be approved, 1.4 and lenders are fighting to fund you.
once we finish the rehab of the other 20 units, the cash flow will be about 18k/month and that is at low rents!
All I have to say is that, this one is over my head. But one day I will understand and make deals like this one.
Good luck!!!!
It was way over my head not that long ago as well!
With the numbers you mentioned above, sounds like a good deal as long as you crunch your numbers thoroughly. Not sure about which companies provide downpayment assistance, but let us know how this turns out.
Good luck!
- Tom
I haven't heard from anyone wanting to put up the down payment assistance yet but I will let you know what I find out.